Smart Power and the Private Sector

July 29, 2009

Development, Diplomacy and Defense, the three pillars for smart power. 

We heard Secretary Clinton introduce the three D’s for the Administration’s foreign policy agenda  at her confirmation hearing on January 13. 

As we STILL wait for public sector leaders to be named, specifically an Administrator for USAID and CEO for the Millennium Challenge Corporation (MCC), the private sector has continued to push forward on development agendas and projects even in this tough economic climate. 

I don’t think anyone can deny the role the private sector plays in international development; it’s huge.  Companies are not just giving to, but investing in communities, producers, and people all over the world.


 We, as a development community, have moved forward on a public-private partnership agenda for the past few years and agencies within the U.S. government have adapted to this change.  The Global Development Alliance at USAID is designed to work with companies on joint projects.  MCC, in theory, designs compacts to incentivize companies to invest in the compact countries.  And the State Department, which has recently made the biggest push in PPPs, recently named Ambassador Elizabeth Bagley as special representative for global partnerships. 

These internal re-organizations, or agency creations in the case of the MCC, have proven to bridge the gap between sectors, but we have just touched the surface on the work we can do together. 

Where does the private sector fit into the smart power agenda?  Representative Adam Smith who spoke at BCLC’s conference last year, Representative Crowley, who champions for working with the private sector on development agendas, and Claude Fontheim of Fontheim International recently wrote an op ed in The Hill about  smart power as it relates to security.  They commented, “A key aspect of smart power is the process of using economic diplomacy tools — like economic assistance for health and education — which can win hearts and minds in countries that pose transnational threats.” 

These economic assistance programs are not just carried out by the public sector and NGO arms of the development community.  The private sector plays an instrumental and gigantic role in delivering sustainable solutions to poverty reduction.  You might even be surprised how advanced and localized these development programs are. 

While Chevron’s  human rights work in Nigeria,  IBM’s partnership with IFC to train middle mangers in Cairo, or Eli Lilly and Company’s malaria prevention programs in Ghana might not make headlines, it’s important to remember that business contributes to global development … and in a big way. 

So as we move forward on the smart power agenda and finally receive leadership at USAID and MCC, lets not forget the private sector has a huge role to play and is NOT going anywhere.  

Business is part of the solution. But don’t believe me.  Check out what some of BCLC member companies are currently doing in countries and communities all over the world.  

Come to BCLC’s Emerging Markets conference this year on Oct. 1 & 2 if you are interested in learning more about the private sector’s contributions to global development, or email me for more information.